United
States General
Accounting
Office
Report to Congressional Requesters
November
1993
B-2 BOMBER
Assessment of DOD’s
Responseto Mandated
Certifications and
Reports
GAO
United States
General Accounting Office
Washington, D.C. 20848
National Security and
International Af’fairs Division
R2499s9
November 3,1993
The Honorable Sam Nunn
Chairman, Committee on Armed Services
United States Senate
The Honorable Daniel K. Inouye
Chairman, Subcommittee on Defense
Committee on Appropriations
United States Senate
The Honorable Ronald V. Dellums
Chairman, Committee on Armed Services
House of Representatives
The Honorable John P. Murtha
Chairman, Subcommittee on Defense
Committee on Appropriations
House of Representatives
Department of Defense Authorization Acts for fiscal years 1990,1992, and
1993 required the Secretary of Defense to deliver to the Congress, certain
certifications and reports concerning the B-2 bomber program. The
Congress restricted the Air Force’s use of about $2.3 billion appropriated
in fiscal years 1992 and 1993 for procurement of B-2 aircraft until those
certifications and reports are delivered and an act of the Congress is
passed authorizing release of the funds. The authorization acts also call for
our office to report to the Congress concerning the certifications and
reports submitted by the Secretary. This is an interim report in response to
that legislation. A detailed classified report will be issued shortly.
Background
The 1990,1992, and 1993 Defense Authorization Acts require the Secretary
of Defense to meet certain B-2 reporting and certification requirements
before the last 5 of 20 planned aircraft can be procured’ and the funds
restricted by those acts can be obligated. The intent of the legislation is to
control B-2 procurement decisions by requiring the Secretary to deliver
certain assurances prior to procurement of additional B-2s. Collectively,
the provisions required completion of certain demonstrations and flight
‘Use of the term procured, in this instance, means award of a definitized contract providing prices,
terms and conditions, and requiring delivery of the aircraft on a negotiated schedule.
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tests, assurance of compliance with standards for fbcal management
controls and quality assurance practices, and submission of a cost report.
The authorization act for fiscal year 1990 was passed when the planned
B-2 program quantity was 132 aircraft, and the act for fiscal year 1992 was
passed after the program quantity had been reduced from 132 to 76
aircraft. The act for fiscal year 1993 was passed after the program quantity
had been reduced to 20 aircraft. The current program remains at 20
operational aircraft, and the Air Force has awarded contracts for
production of 16 of those aircraft. Accordingly, the restrictions in the acts
now apply only to procurement of the last five aircraft.
bong lead activities on the last five B-2s began in October 1989, and the
Congress provided continued funding for these aircraft in fiscal years 1991
through 1993. The five aircraft were 60 percent to 7O.percent assembled as
of September 1993. Air Force officials advised us that prices for the
aircraft have been negotiated with the contractor, but a definitized
contract for the aircraft has not been signed. In July 1993, we reported2
that the potential savings available at September 30,1993, by not
completing procurement of the last five aircraft would be about
$1.2 billion and would decrease as long as long lead activities continued
beyond that date. Air Force officials believed the savings would have been
about $600 million. The total cost of development and procurement for
20 aircraft is estimated at $44.4 billion in then-year dollars.
Results in Brief
The Secretary of Defense, on October 14, 1993, certified that 28 legislative
requirements associated with B-2 performance, fiscal controls and quality
practices, and submission of a cost report had been met. The Department
of Defense provided us with evidence that indicated that the requirements
involving B-2 performance and fiscai controls and quality practices had
been met. The requirement concerning submission of a cost report,
however, has not been met.
Performance
Certifications
Although the requirements concerning performance appear to have been
met, we believe the data supporting one requirement concerning the
offensive and defensive avionics is barely sufficient. In our opinion, more
complete integration and fright testing of offensive and defensive avionics
in a B-2 is needed to provide convincing evidence that the Secretary’s high
confidence in the B-2’s offensive and defensive avionics is warranted.
2B-2Costs, GAO/NSIAD-93-263R,July 23,1993.
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B-2 Bomber
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Only 30 percent of the flight test program, primarily developmental testing,
has been completed. Satisfaction of the legislative requirements
concerning B-2 performance does not ensure that ah the risks related to
the B-2 program have been eliminated. There are risks that problems with
B-2 performance will be discovered as the remaining 70 percent of the
flight test program is completed. In particular, flight tests to demonstrate
performance have not been completed for several aircraft characteristics
that are closely related to the certification. These include
9 flight tests with a full complement of integrated B-2 offensive and
defensive avionics incorporated in a B-2;
l
flight tests to demonstrate detection and survivability of a B-2 configured
in its currently planned &MI design (Block 30), demonstration that B-2 low
observable design is repeatable, and flight tests in an operational
environment against threat radars or simulators;
l
integration and flight tests of precision weapons needed for successful
accomplishment of the conventional mission; and
9 flight tests demonstrating the full range and payload capabilities of the B-2,
including resolution of issues involving aerodynamic loads being
experienced that exceed the predictions that were used to design the
aircraft’s wing structure and perform ground tests.
Fiscal Controls and
Quality Practices
Certification
Although the Secretary certified that fiscal management controls and
quality assurance practices of the B-2 contractor and major subcontractors
met government standards, he noted that the Department was closely
monitoring the prime contractor’s discipline in implementing the fiscal
management control system. The applicable system is the cost, schedule,
and control system required by the contract. The objective of the system is
to provide for budgetary and schedule control of the effort on contract,
and to calculate cost and schedule variances from the planned baseline.
The Air Force, in 1989, determined that the system design met the
requirements of the contract. However, the contractor has had difficulty in
implementing changes to cost and schedule baselines needed to reflect
changes to program schedules. Since the system design has been
determined to meet the standards required by the contract, the
requirement of the act has essentially been met; however, the Air Force is
closely monitoring the contractor’s implementation of the system.
Cost Report
The Secretary submitted to the Congress the December 1992 B-2 Selected
Acquisition Report (SAR) to fulfill the requirement for a B-Z cost report
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imposed by section 161(f) of the 1993 Defense Authorization Act. We
recognize that some of the information required by the act may be
included in the B-2 SAR. However, we do not believe that the
Department’s submittal of the B-2 SAR satisfies the statutory requirement
because it does not contain the specificity required by the legislation
The act stipulates that the Secretary describe the total acquisition costs
associated with a E M program resulting in 20 deployable aircraft, including
alI costs associated with development and procurement. It further
specifies that the description of procurement costs should include cost
estimates for all planned modifications, improvements, tooling, support
equipment, interim contractor support, initial spares, termination, and
other government costs.
A SAR is a standard report submitted to the Congress on all major defense
acquisition programs, It has a standard format that does not include
detailed cost estimates as specifically required by the act for the B-2.
Therefore, we conclude that a Merent lype of cost report was required by
section 151(f) of the act.
The legislative history of section 161(f) supports this interpretation. The
conference report indicates that the language that was adopted was based
on provisions of the House Bill, The explanation of the House Armed
Services Committee indicates that the committee imposed the requirement
for a report because of its concern about the quality and accuracy of the
cost information it had previously received from the Air Force.
We found the B-2 SAR describes changes to the development and
procurement cost estimates in general. It briefly discusses costs
associated with those areas specified in the act if those areas had
undergone any changes to cost in the past year. However, it does not
adequately describe cost estimates for B-2 development and procurement
programs and does not specifically describe cost estimates for elements
specified by legislation.
Recommendation
Because the B-2 SAR submitted by the Department does not meet the
requirement of section 151(f) of the 1993 act, we recommend that. the
Secretary of Defense issue a revised report with the information required
by the Congress.
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Scope and
Methodology
We reviewed the certification package submitted by the Secretary to the
Congress, as well as earlier drafts of portions of the package, and
supporting documentation provided by the Air Force, We interviewed
officials of the B-2 Systems Program Office, W right-Patterson Air Force
Base, Ohio; the Combined Test Force, Edwards Air Force Base, Cahfornia;
the Departments of Defense and the Air Force, Washington, D.C.; and the
Northrop B-2 Division, Pica Rivera, California
We performed our work from November 1992 to October 1993. We have
not obtained comments on this interim report from the Air Force or
Department of Defense.
We are sending copies of this report to the Ranking Minority Members of
your committees; other appropriate congressional committees; the
Secretaries of Defense and the Air Force; and the Director, Office of
Management and Budget. We wiIl also make copies available to others
upon request.
This report was prepared under the direction of Louis J. Rodrigues,
Director, Systems Development and Production Issues, who may be
reached at (202) 5124341 if you or your staff have any questions
concerning this report.
Frank C. Conahan
Assistant Comptroller General
(392749)
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